Source: https://www.valuewalk.com/2020/10/central-bank-bahamas-sand-dollar/
Thursday, October 22nd, 2020
Media: ValueWalk
What happened?
The Central Bank of the Bahamas has developed one of the first Central Bank Digital Currency (CBDC) in the world, the Sand Dollar, which is a digital version of the Bahamian dollar.
Whom and where it affects?
This digital currency has an instant availability for all Bahamian residents. Even though The Bahamas is not a big nation, having only three hundred and ninety-three thousand habitants, this CBDC development can have a huge financial impact worldwide, mostly thanks to its direct link to the US market.
What sort of public or private institutions are involved?
The CBDC adoption is mainly intended to provide financial access to the Bahama’s increasingly unbanked population due to the banking sector downsizing physical branches. The Sand Dollar is backed by the Central Bank of the Bahamas and tied to the BSD, and thus the USD, so it would be a regulated alternative to non-governmental third party stablecoins.
Why is it important for Banking and Finance?
The main purpose of Project Sand Dollar is to modernize and streamline the archipelago’s financial system, with the benefits of greatly reducing costs and improving financial inclusion among communities throughout The Bahamas.
What do you think will be the consequences in the foreseeable future?
We will soon see other nations follow the bahamas by creating their own state backed crypto currency. The Sand Dollar will serve as a live test, with new currencies being implemented in different manners, depending on the success or failure of the Sand Dollar.
Key words: Central Bank Digital Currency, Sand Dollar, Digital Transformation, Banking Sector.